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Silver Plunges 12% and Recovers in 24 Hours
Daniel Drew, 12/1/2014 Tweet There's no silver lining in this playbook for the traders who bought silver over Thanksgiving. Silver prices plunged $2 per ounce from $16 to $14, with the heaviest losses occurring during a 10 minute period in the overnight session. But this stop loss nightmare turned into a bottom fisher's dream when silver rallied to recover all of the losses, with a massive spike in just 5 minutes around 5 a.m. Sometimes averaging down does work. But, if you're like most traders, you're unlucky, and you cut your loss just above $14. Maybe you even went short. It's interesting this should happen today because yesterday, I wrote a piece about the Swiss gold referendum and how the selection of a currency is quite an arbitrary process. If gold didn't exist, the gold bugs would be silver bugs. Today's price action in silver is yet another reminder that there is no such thing as honest currency. Money cannot be a fortress against a dangerous world because the very concept itself is a function of human nature. |